Income inequality in contemporary Russia in the long-run historical perspective

In this article we focus on documenting the dynamics of income inequality in Russia and its patterns during the last decade of economic stagnation, relative to previous historical periods. We use a wide range of estimates from the data sets and the research literature: the official statistics from Rosstat, RLMS-HSE, the World Bank, WIID by the UNU-WIDER, findings provided by the research teams of J.C. Galbraith Jr., J.L. van Zanden, T. Piketty, as well as by their critics. Long time series on the dynamics of inequality in Russia, constructed by the author, are augmented by the data for the last decade, with revision of some estimates for previous periods. We expand our analysis of inequality issues, based on neoclassical human capital theory, by employing methods of institutional economics and economic sociology. Considering the recent literature on relationships of inequality measures with their perceptions, the article provides a broad pattern of inequality as an institutional feature of the post-Soviet Russia society. Over the past decade, the dynamics of income inequality in Russia has been weakly expressed: according to the evidence from most of the sources, its decline has sharply slowed down; according to other papers, it has increased moderately. Historical and cross-country comparisons suggest that inequality remains relatively high. I highlight the issues of correlation between the dynamics of inequality of wages, of total income, and the level of poverty, reduction of which appeared to be more impressive than that of measured inequality. I generally confirm my earlier outlook as regards persistence of an elevated level of income inequality in Russia. The paper concludes that the recent adoption of elements of progressive taxation provides the basis for reduction in wage differentials by 5-6 percentage points measured by the Gini index in the perspective of 10-15 years.